Special Service and Features
RBI commences Financial Literacy Week campaign in Kerala
More people will be brought under formal banking sector: Smt Reeny Ajith, Regional Director, RBI
As part of the Reserve Bank of India's efforts to promote financial literacy at the ground level, the Financial Literacy Week is being held from 8th to 12th February, 2021 across the country. Smt. Reeny Ajith, Regional Director, Reserve Bank of India, launched the state level campaign at a function in Thiruvananthapuram today. The theme of this year's Financial Literacy week is ‘Credit Discipline and Credit from Formal Institutions’.
Speaking on the occasion, Smt Reeny Ajith told that the Government and the RBI have taken several coordinated steps to bring about financial inclusion. She pointed out that this years’ theme “Credit Discipline and Credit from Formal Institutions” is important for bringing more people into the fold of formal banking sector and reducing their reliance on informal banking channels. She listed out some benefits which the common people can take advantage of, through formal banking channels, such as transparency in availing credit, better recourse to structured grievance redressal mechanisms, improved credit score, possibility of availing further credit with better terms in future etc. By disbursing loans to entrepreneurs and self-help groups, formal banking system facilitates the creation of economic value, she said. Besides, the formal banking system is better equipped to prevent slippages in loan accounts compared to informal systems of credit, she added.
While delivering his speech on Practical bankers’ perspective, Shri. Aravind Gupta, General Manager, SBI told that although literacy in the state of Kerala is close to 100%, financial literacy is only about 24%, according to some studies. The common people refrain from approaching the banks for several reasons, such as cumbersome procedure, the perception that the formal banking institutions are not approachable, customer service of banks being not up to people’s expectations etc, he added.
Shri N Ajith Krishnan, Convener, SLBC Kerala and General Manager, Canara Bank said that credit discipline is an important factor in evaluating a potential borrower. Hence it is beneficial for the borrowers and the public in general to have basic financial discipline. However, it cannot be brought about overnight and requires sustained practice over long term, he added. Promoting financial literacy and discipline in schools and colleges therefore becomes important, he added.
While speaking on the occasion, Shri P. Balachandran, Chief General Manager, NABARD told that the three major areas of focus for improving financial literacy among the common people are schools, Panchayati Raj Institutions and kudumbasree units. He said that some kind of structured curriculum on financial literacy need to be introduced in schools. Since Panchayati Raj Institutions have more than 50% of their strength represented by women, it is important to inculcate the lessons of financial discipline and financial literacy into them, he added.
Shri G. Ramesh, Banking Ombudsman, Kerala & Lakshadweep said that the delay in sanctioning of loans by formal banking institutions drive the poor to informal sources of credit. He urged the banks to sensitize their branch functionaries in dealing with the customer, the branches being the first level of dispute redressal mechanism.
This year, as part of the Financial Literacy Week campaign, three posters focusing on three different themes viz. 1) borrowing from formal institutions, 2) responsible borrowing and 3) timely repayment were released by Smt. Reeny Ajith, Regional Director, RBI. A centralised mass media campaign is also being planned during this month, she said.
Sh. Aravind Gupta, General Manager, SBI, Shri N Ajith Krishnan, Convener, SLBC Kerala and General Manager, Canara Bank, Shri P. Balachandran, Chief General Manager, NABARD, and Shri G. Ramesh, Banking Ombudsman, Kerala & Lakshadweep spoke on various aspects of financial literacy and financial inclusion. Shri Cedric Lawrence, General Manager, Financial Inclusion and Development Department, RBI welcomed the gathering and Shri Muralee Krishna, Assistant General Manager, RBI delivered the vote of thanks. Senior officials from all major scheduled commercial banks participated in the programme.